Senior Contributor
Wolf3
Posts: 3,198
Registered: ‎01-24-2010
Re: Why Pay New Charges In Full Before Statement Closes?

I am a fan of the float.    I plan my apps in advance, so I can adjust my utilization when I need to.  

 

I don't feel the need to maximize my FICO score when I don't need it.   

 

I don't get dressed up to stay home and watch TV either.

 

Frequent Contributor
SwampSystems
Posts: 358
Registered: ‎06-25-2012
Re: Why Pay New Charges In Full Before Statement Closes?

compassion101 wrote:

I'm with OP, I use the float unless I anticipate applying for credit.

 

In my mind, good credit score is something we attain so that we can take advantage of credit offers, floats, 0%APRs, rewards, better interest rates, etc. Alot of people bypass many of the advantages (particularly the floats and the 0%APRs) so that they can keep their scores higher on a consistent basis. But other than the spontaneous app,
I don't see what benefit it has. Ther important thing to me is not that I know what my exact credit score is today, but that I know my credit score can range from 670-770 depending on how much util I have reporting, and that I can generally adjust it to where I want it to be within 30 days.

 


The benefit shows up when your creditors periodically soft pull you for account review. Increased limits, decreased APRs, promotions, cash back incentives, and other things are offered to people who keep their report in shape. And if you get your report in shape just to acquire new credit, and then you start floating balances and using 0% APR offers, it can make you appear as a higher risk to your creditors than you were when you opened the account; this can cause financial reviews and adverse action.

 

I do take advantage of 0% offers and sign-up bonuses, but I try to limit them enough to still keep my reports in excellent shape.

Regular Contributor
bobebob
Posts: 244
Registered: ‎08-14-2011
Re: Why Pay New Charges In Full Before Statement Closes?

I like the float too, but recently it's been something of a hobby to see my score keep going up and up. :smileyhappy:

 

Also, I have everything in my budget planned to be funded in my checking account before it is spent so there isn't much of a reason not to just go ahead and pay it early before the statement posts.  The APR on the checking is so abysmal, I doubt it could even gain me a penny to wait until the end of the grace period.

 

If I had some unexpected expense come up I would use the float to make it easier to pay off.  But I would still PIF.  I hate paying interest.

bobebob || June: My FICO SW EQ(Upgraded Version) = 821 ||June: Walmart TU Fico=834Goal = FICO's>800 || In my wallet: CostcoAmEx(20k), DCU Visa Platinum (10k), BoA Visa Signature (17.1k), Walmart Discover (7.5k), AmEx Corporate (5k). All PIF every month.
Valued Contributor
Dustink
Posts: 2,980
Registered: ‎10-02-2012
Re: Why Pay New Charges In Full Before Statement Closes?
[ Edited ]

SwampSystems wrote:

compassion101 wrote:

I'm with OP, I use the float unless I anticipate applying for credit.

 

In my mind, good credit score is something we attain so that we can take advantage of credit offers, floats, 0%APRs, rewards, better interest rates, etc. Alot of people bypass many of the advantages (particularly the floats and the 0%APRs) so that they can keep their scores higher on a consistent basis. But other than the spontaneous app,
I don't see what benefit it has. Ther important thing to me is not that I know what my exact credit score is today, but that I know my credit score can range from 670-770 depending on how much util I have reporting, and that I can generally adjust it to where I want it to be within 30 days.

 


The benefit shows up when your creditors periodically soft pull you for account review. Increased limits, decreased APRs, promotions, cash back incentives, and other things are offered to people who keep their report in shape. And if you get your report in shape just to acquire new credit, and then you start floating balances and using 0% APR offers, it can make you appear as a higher risk to your creditors than you were when you opened the account; this can cause financial reviews and adverse action.

 

I do take advantage of 0% offers and sign-up bonuses, but I try to limit them enough to still keep my reports in excellent shape.


+1

 

Good point. I think it is always good to keep utilization below 10%, but I feel banks won't inflict any adverse actions for 20%. That should be plenty to cover a months spending, or some 0% offers.

 

Too many INQs & low AAoA so I'm off to tend the Garden.     Age:21    


     $14k          $8.5K          $7.5k          $7.5k         $6.5k             $6k             $5k            $5k             $5k              $5k           NPSL       @ 0%
Established Contributor
masscredit
Posts: 691
Registered: ‎07-17-2012
Re: Why Pay New Charges In Full Before Statement Closes?

I use my cards to cover the monthly expenses that can be covered by them so I plan which cards I'm going to use and when if I want to fine tune my score. Maybe wait a few extra days to pay for a few things to allow a new statement to post then use "card A." Like if it was this month and that statement closes today, I'd pay those expenses tomorrow. They won't show up until the statement that posts Nov 11th and the $ wouldn't be due until around Dec 6th. In the meantime, the $ that I set aside to cover those expenses are paid on card B (or B and C depending on cards that are used).  This works when I've made some purchases that will have me carrying a balance for a little while. By planning my credit card use and payments, I can greatly minimize any finance charges and maximize my credit score if I want to. By doing this a few months ago, I pushed myfico score here up from 648 to 693. Back then I only had $1800. of available credit and was using close to $1500. I'd say most of that score change was from utilization going way down. Maybe a few inquiries turned 1 year but there wasn't many.  Utilization seems to be a big part of the score.

 

That app spree allowed me to gain close to $7k in available credit so my utilization will stay low. The inquiries from that app spree and me not caring which cards I used after knocked about 22 points off of myfico score viewed here. Oh, and I made use of a little of the new credit. That will be paid in the next few months, I'll "fine tune" again and see where the scores fall then.  It works...


|****$6000****|****$6000*****|****$4500*****|****$2500****|****$1600****|****$3000****|******$750******|*****$700*****|
EX - 651 (MyFico 06/05/14) TU - 662 (Barclay 08/05/14 ) EQ 04 - 699 (DCU -07/26/14) EQ 08 - 686 (MyFico -08/09/14)
Valued Contributor
creditnocash
Posts: 2,201
Registered: ‎07-23-2012
Re: Why Pay New Charges In Full Before Statement Closes?

it varies for me. i dont mind floating. but ive held a balance on my best buy for well over a year. obviously my score has suffered. even though my util is now 6% with the 425 reporting i plan on having 1% by end of the year. 

all other cards i try to pif or at least the next month before the intrest hits. 

the only intrest ive EVER paid is when i didnt pay my best buy 18 month deal and hit me with 75 dollars in intrest at once. then i paid that off quick. 

 

but like stated if you get softed they see that you have a 2500 balance on 3k card its going to raise some eyebrows. 

Current: Discover Fico 689 8/14 Walmart Fico 697 8/14

Inquiries (24 Months): EQ 6 TU 3 EX 4 | Most Recent: 09/04/2013
2 Inquiries in The Last 12 Months


2014 Goals:
Lower Utility

Amex Zync(Unicorn)
Chase Freedom$1500
Discover IT$2900
Citi Diamond Preferred$6000
Citizens Mastercard$7000
Established Contributor
masscredit
Posts: 691
Registered: ‎07-17-2012
Re: Why Pay New Charges In Full Before Statement Closes?

I can see not having all of your cards at 90%+ of the CL but it's like they give you credit, they want you to use it but they don't want to see you using it much.   Why keep getting CLIs if they want you to keep your balances low or at zero?

 

I know some things have changed in credit world since the economy took a dump in 2008 but has it always been like this? Up until recently, I never really kept track of my credit score. I had an idea what it was at times but I never followed it closely. In the early to mid 2000s, most of my cards would be at 80-90% of the CL ($25k, $50k+), they would be PIF just before the due date each month, I had over 150k in vehicle loans, a couple of jet ski loans and didn't have to jump through any hoops to get a $510k mortgage. They just kept giving me $ to pay for things that I didn't pay cash for. With what I read now, the credit world seems to be really tight. Did things change that much? 

 

Oh and when the economy took a dump, so did my business, credit, marriage and everything above so I can see why things would change because I know I'm not the only one... 


|****$6000****|****$6000*****|****$4500*****|****$2500****|****$1600****|****$3000****|******$750******|*****$700*****|
EX - 651 (MyFico 06/05/14) TU - 662 (Barclay 08/05/14 ) EQ 04 - 699 (DCU -07/26/14) EQ 08 - 686 (MyFico -08/09/14)
Valued Contributor
Uborrow-Upay
Posts: 2,710
Registered: ‎10-16-2008
Re: Why Pay New Charges In Full Before Statement Closes?

Wolf3 wrote:

I am a fan of the float.    I plan my apps in advance, so I can adjust my utilization when I need to.  

 

I don't feel the need to maximize my FICO score when I don't need it.   

 

I don't get dressed up to stay home and watch TV either.

 


Wolf3, I think I love you!

 

Please stop by my house and tell my wife what you just told to the entire world.  She puts checks in the mail (yeah, can you believe "the mail") before the bills are even cold from the mailman's hand...

 

 

Uborrow-Upay

 

Valued Contributor
Dustink
Posts: 2,980
Registered: ‎10-02-2012
Re: Why Pay New Charges In Full Before Statement Closes?

Uborrow-Upay wrote:

Wolf3 wrote:

I am a fan of the float.    I plan my apps in advance, so I can adjust my utilization when I need to.  

 

I don't feel the need to maximize my FICO score when I don't need it.   

 

I don't get dressed up to stay home and watch TV either.

 


Wolf3, I think I love you!

 

Please stop by my house and tell my wife what you just told to the entire world.  She puts checks in the mail (yeah, can you believe "the mail") before the bills are even cold from the mailman's hand...

 

 

Uborrow-Upay

 


I assume she also uses a debit card??? Haha it's good she is on top of things.

 

Too many INQs & low AAoA so I'm off to tend the Garden.     Age:21    


     $14k          $8.5K          $7.5k          $7.5k         $6.5k             $6k             $5k            $5k             $5k              $5k           NPSL       @ 0%
Frequent Contributor
SwampSystems
Posts: 358
Registered: ‎06-25-2012
Re: Why Pay New Charges In Full Before Statement Closes?

Dustink wrote:

SwampSystems wrote:

compassion101 wrote:

I'm with OP, I use the float unless I anticipate applying for credit.

 

In my mind, good credit score is something we attain so that we can take advantage of credit offers, floats, 0%APRs, rewards, better interest rates, etc. Alot of people bypass many of the advantages (particularly the floats and the 0%APRs) so that they can keep their scores higher on a consistent basis. But other than the spontaneous app,
I don't see what benefit it has. Ther important thing to me is not that I know what my exact credit score is today, but that I know my credit score can range from 670-770 depending on how much util I have reporting, and that I can generally adjust it to where I want it to be within 30 days.

 


The benefit shows up when your creditors periodically soft pull you for account review. Increased limits, decreased APRs, promotions, cash back incentives, and other things are offered to people who keep their report in shape. And if you get your report in shape just to acquire new credit, and then you start floating balances and using 0% APR offers, it can make you appear as a higher risk to your creditors than you were when you opened the account; this can cause financial reviews and adverse action.

 

I do take advantage of 0% offers and sign-up bonuses, but I try to limit them enough to still keep my reports in excellent shape.


+1

 

Good point. I think it is always good to keep utilization below 10%, but I feel banks won't inflict any adverse actions for 20%. That should be plenty to cover a months spending, or some 0% offers.

 


Case in point: Discover soft pulled me a few days ago, and today's statement shows my APR was reduced again from 16.24% to 14.24%. So it pays off to keep your file in good condition even if you're not actively seeking new credit.